Q2. Overview: This textbook chapter examines how to set pay and benefits for expatriates and employees in multiple countries. Understanding the different types of compensation is essential if you are a compensation specialist, HR leader, payroll specialist, business owner or manager. LUMPSUM APPROACH Corresponding courses. Explain the parties involved in international compensation system? Q3. INTERNATIONAL CITIZENâS APPROACH 8. In many countries, the definition of total compensation goes well beyond salary and includes bonuses and benefits, so employer contributions like social security, pension and severance pay can be calculated at a much higher cost than you'd expect. Chapter 22: International Renumeration. Jeff Zinser / About Author. Leave a comment Cancel reply You must be logged in to post a comment. January 13, 2020. More posts by Jeff Zinser. Compensation and benefits, commonly known as C&B, is a sub-discipline of human resources. INTRODUCTION It should be planned to achieve the mobility and staffing goals of the organization. It is usually different from what the rest of the workforce receives. International benefits and compensation costs can multiply . List the components of an international compensation program. What are different challenges faced by the management concerned to various benefits in international compensation program. This involves giving expatriate a predetermined salary and letting the individual decide about how to spend it. Explain the approaches to international compensation system. Learn about the balance sheet approach to expatriate compensation and tax-equalization strategies to maintain purchasing power. As multinational human resources marches toward greater and greater international integration, compensation and benefits lead the charge. There are a few methods commonly used to determine global expatriate compensation. However, in todayâs tight market, negotiations will likely favor the potential expat. Q4. The international compensation package typically provides employees with a base salary plus allowances to cover the higher cost of living and housing in the international destination and sometimes incentives to provide encouragement for employees to accept and remain at international assignments. 92 Expatriate Compensation. In most English-speaking countries, people refer to it as remuneration or total rewards. Finally, there is the regional system, under which the MNC sets a compensation system for all expatriates who are assigned to a particular region. 91 Multiple Country Compensation Programs. Learn about the major objectives and strategies of international compensation plans, elements of expatriate compensation and benefits, and alternative approaches to taxes in the international environment. Compensation for international assignments may be more complicated than for domestic. Q5. For many years, expatriate compensation has been focused on a dilemma: having assignees on expensive home-based expatriate package versus localization - which is about replacing expatriates with locals or at least transition expatriates from an expatriate package to a local salary. A new international assignment landscape is challenging traditional compensation approaches. Executive compensation is the pay + benefits package senior executives receive from their employers. Expatriate Compensation â A good compensation package is one that is considered fair by an expatriate, but it must also be cost-effective for the organization.